Less than 50% of businesses survive more than five years. Visit government census or Depart of Industry web sites and if you look at the detail you will see irrefutable evidence
The analysts common reason for this tragedy is the unfortunate ones just ran out of funds. This deliberation is useless and so I decided to seek out those directly and indirectly involved in failed businesses to see if I could determine the details, establish any consistent reasons for failure and publish them on the web in the hope that my discoveries would help others avoid a similar fate. I uncovered eight common reasons for business death. Here are three of them:
No Vision, mission or strategy
“If you don’t know where you are headed then how are you going to get there?” You have to have a clear picture of what you want to achieve and how the future will be for your business if you achieve it. To achieve anything you it is essential to have a strategy. Strategy is like a route map it shows you how to get there. It’s a structured series of activities. To make a strategy work you have to create a business plan that not only contains the key actions and milestones but can used to measure business performance against. A key instrument for monitoring business perfomance is the sales forecast.
Lack of a system for marketing or sales
Marketing is about finding markets and testing strategies to position your offering in the minds of prospects and moving them into your sales channel. Sales is about engaging the prospect and getting them to buy your product or service. Marketing is a process of measuring and improvement of the tactics you employ to engage prospects. Sales is the process of acquiring leads, forecasting sales and closing sales. In well run companies a decent marketing and sales system is consistently underpinned by a well designed sales forecasting software system. The tools in these systems help you to track and measure what is happening in the sales and marketing processes. Outcomes arederived from reports created by the software which can then be used to compare planned vs actual results. The bottom line is what gets measured gets improved or discontinued. This is the critical formula for success.
Lack a system to monetise their current customer base
There is a well known saying that 80 percent of your sales should come from 20% of your customers. Your job is to achieve or surpass this number. Customers who have already bought from you are easier and cheaper to persuade to buy from you than prospects that have not. A combination of good web based crm software and sales forecasting software will give you the information of recent activity and allow you to search for opportunities in your current customer lists.